THE JOY OF CANDLESTICK TRADING - a Learning Experience

[VulcanClassic]

Tymen,

#5 is the long engulfing but it is barely on the BB. It went long after all but I may not have traded it because it was so far off the BB.

I know we're only going long but 6 looks like a short trade to me, then it went long anyway. I guess it depends on what the higher timeframe is doing as well.

Is this pattern only valid for longs? Evening star/abandonded baby for shorts?

[KENNETH LEE]

1,2,5, and 7

Wouldn't trade any of them though..

[Ray_1]

Only 5 is considered a long engulfing pattern but the top of the wick has touch the middle Bollinger band. In addition the red candlestick doesn't touch the bottom of the Bollinger band.

[tymen1]

Answer to Exercise 8

#5 is the only correct answer.

It is a long engulfing pattern.

#6 is a short engulfing pattern.

I am amazed at the quality of the answers.
All I asked for was the number of the candle, but everyone also gave an analytic commentary as to the nature of the candles.
This is excellent.
It shows that readers are learning, and developing correct visual trading skills as well.

To Jimmy Jones :

I am sure you are familiar with the trading terms - going short (trading down) and going long (trading up).

Now an engulfing pattern can appear on either the upper or lower Bollinger bands.

If and engulfing pattern appears on the upper band, we trade short.
The pattern is called a short engulfing pattern.

If and engulfing pattern appears on the lower band, we trade long.
The pattern is called a long engulfing pattern.

Hope this helps.

[tymen1]

It is now time to consider entries on a long engulfing pattern.

As you are aware, we have been trading an evening star, which is a short trading pattern.

We have developed the 5 minute Keltner chart for the purposes of getting a better entry than just clicking at the open of the entry candle.

Now this 5 minute Keltner chart works for going short.
So what are we going to do now that we are trading long??

On Monday, I will post the simple answer to this problem.

However, a warning!

We are now going to trade in the opposite direction that we are used to.
This can bring about confusion.
So be careful!!

If you are accustomed to doing things such as sports, for example, such as sailing or windsurfing, which require that you learn procedures in two opposite directions, you will understand the matters of trading long and short better.

Trading short and trading long are opposite procedures.

If you are dyslexic, however, you may have some problems!!

[FXCaribbean]

Hi to all,

I am new to this thread and quite new to babypips but tymen1 has been very quick to bring me here. I'm reading those 80 pages now (??) and have still 20 to read (gulp!).
It is deep, it is filled, it is very interesting, it is given (much more than only "free" i mean).

Originally Posted by BrianSNJ

When I go live and make some actual money, I am going to buy the school PDF. Not that I need it, I just want to give back to this site.

I quote this 25 pages ago message because it is so TRUE. I think all of us MUST give back to babypips. Come on, they deserve it a 100 times with or without live trading.

My next spend is for the Nison book and i hope i'll be very soon with you all with a little more knowledge.

Tymen1 thanks.

FXCaribbean
"Don't go where there is a path. Open a new one and leave a trail".

[Pilgrim]

Tymen,
It is obvious that you are an excellent teacher. I noticed you said you were a retired school teacher in an earlier post. Your students were fortunate to have you as a teacher. I have read this thread from the beginning and we are reaping the benefits of your many years of teaching experience and skills. I just wanted to say Thank you! I look forward to trying your method. I am new to Forex and am very glad to have come across you’re “Joy of Candlestick Trading.” I think I have saved myself from a lot of frustration, confusion, and disappointment by starting with your strategy. It is amazing that I can live in West Texas and receive instructions from you in Australia.
Thank you!
Bruce

[FXCaribbean]

Hi again,

Ok last 20 pages read !. It was really hard to digest all. I need practice now but i agree on most exercises that were proposed. The very last which was the worse was the main trap and i think i would have done the same as Vulcan.

I am a little bit disapointed because i missed the real fire with that Ultimate Method = THE method but i do hope we'll talk about it again either to test (exercises) or improve.

Did i told you i'm still on DEMO account using MT4 and just downloaded Dealbook from GFT website.

On this engulfing pattern and even if it is too late, i would have said 5 also and 6 is a rather classic one right ?

Thanks again mister teacher tymen1.


FXCaribbean
"Don't go where there is a path. Open a new one and leave a trail".

[FXCaribbean]

Hi,

Here is my first questions on the ultimate method...

As everyone can't stay in front of his computer all the time, can i conclude that even if one is late entering the UM, then he missed the first lot, he still can enter at the re-trace hit with the 2 lot ?

The ultimate method is based on Evening star and then we go short. Why this short choice first ? I ask because, at first sight, going short as a beginner was frightening me more than going long ! Would you say that short is much more positive than long and you are much more confident with this reversal pattern ?


FXCaribbean
"Don't go where there is a path. Open a new one and leave a trail".

[VulcanClassic]

FxCaribbean,

Just curious where you are in the Caribbean?